r=2  V 


HEALTH  INSURANCE 

Advantages  to  Industry 


NEW  YORK  STATE 
FEDERATION  OF  LABOR 


THIRD  REPORT 
of  the 

Committee  on  Health 


NEW  YORK  STATE  FEDERATION  OF  LABOR 


1918 


REPORTS  ON  HEALTH  INSURANCE 


1.  Official  Endorsement  of  New  York  Stale  Federation 

of  Labor  with  Report  of  Committee  on  Health. 

2.  Discussion  of  Health  Insurance  Bill  of  New  York  State 

Federation  of  Labor  (To  accompany  Senate 
Print  692.) 

3.  Advantages  to  Industry  of  Workmen’s  Health  Insurance. 


The  above  reports  and  accompanying  bill  for 
Health  Insurance  may  be  had  upon  application  to  Sec- 
retary Edward  A.  Bates,  New  York  State  Federation  of 
Labor,  Arkay  Building,  Albany,  N.  Y. 


FOREWORD 


In  a report  to  the  State  Labor  Conference  in  Albany, 
January  8,  1918,  the  Committee  on  Health  of  the  New 
York  State  Federation  of  Labor  presented  recommend- 
ations for  legislation  based  upon  more  than  a year’s  in- 
vestigation. The  Conference  adopted  a resolution  favoring 
the  enactment  of  a Health  Insurance  Law  and  the 
committee’s  report  was  afterward  printed  in  pamphlet 
form  with  the  endorsement  of  the  Federation. 


At  a later  Health  Insurance  Conference  in  Albany, 
February  6,  1918,  following  a state-wide  discussion  in 
local  union  meetings  of  an  outline  of  the  proposal,  the 
provisions  of  the  completed  bill  were  again  discussed 
in  detail  by  the  two  hundred  delegates  from  all  parts  of 
I he  State.  The  bill  was  then  unanimously  adopted  for 
introduction  in  the  Legislature  of  1918.  As  introduced 
by  Senator  Courtlandt  Nicoll  the  bill  is  known  as 
Senate  Print  No.  692.  The  record  of  the  discussion  of 
this  measure  at  the  Conference  on  February  6th  has 
likewise  been  printed  in  a pamphlet  as  the  Second  Report 
of  the  Committee  on  Health. 

In  the  course  of  the  investigations  made  by  the 
Health  Committee  during  the  past  year  a large  amount 
of  material  was  gathered  which  leads  to  the  conclusion 
that  Health  Insurance  as  well  as  Workmen’s  Compensation 
will  in  practice  be  of  great  benefit  to  employers  and  to 
the  State  as  well  as  to  the  insured  workers  and  their 
dependents.  In  this  Third  Report  the  Committee  on 
Health  presents  a brief  statement  of  some  of  these 
advantages. 


EDWARD  A.  BATES, 

Secretary-T  reasurer, 

New  York  State  Federation  of  Labor. 


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Ym  W 2. 


THIRD  REPORT  OF  HEALTH  COMMITTEE 


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I « 
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X 

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Organized  labor  in  New  York  State  bas  not  forgotten  that  when 
it  first  sought  legislation  to  provide  workmen’s  compensation  for 
industrial  accidents  it  was  forced  to  meet  organized  opposition  of 
employers.  Officers  of  some  of  the  most  prominent  associations 
of  manufacturers  then  declared  that  a Workmen’s  Compensation 
Law  would  drive  industries  out  of  this  State.  They  predicted 
financial  ruin  for  themselves  with  resulting  unemployment  for  the 
workers.  Some  employers  then  warned  against  such  a “ paternal- 
istic ” measure  as  workmen’s  compensation  and  denounced  it  as 
^ Un-American.”  Some  employers  even  expressed  the  opinion 
that  workmen’s  compensation  would  lead  to  wholesale  “ malinger- 
ing ” by  employees  who  were  expected  to  thrust  their  arms  into 
grinding  gears  and  cogwheels  in  order  to  get  compensation  for 
.such  'self-inflicted  injuries. 

But  workmen’s  compensation  came  in  New  York,  and  in  a few 
short  years  it  has  spread  pretty  much  over  all  the  other  States  that 
are  of  any  industrial  importance.  The  New  York  compensation 
law  is  more  liberal  than  the  others  and  yet  any  attempt  to  repeal 
the  law  now  would  most  assuredly  be  opposed  by  the  organized 
employers  of  New  York  State.  Those  who  in  the  beginning  op- 
posed it  most  loudly  now  admit  that  workmen’s  compensation  has 
in  practice  proven  to  be  a good  thing  for  the  employers  as  well  as 
beneficial  to  their  employees.  In  fact  a very  common  remark 
among  employers  throughout  the  State  with  reference  to  this  sys- 
tem of  insurance  against  accidents  is,  “ The  Workmen’s  Compensa- 
tion Law  is  the  most  beneficent  act  ever  placed  on  the  statute 
books.” 

Experience  with  workmen’s  compensation  has  also  taught  us 
that  the  establishment  of  a system  of  social  insurance  in  one  State, 
even  if  it  is  in  advance  of  similar  legislation  elsewhere,  is  not  a 
serious  handicap  to  the  employers  of  that  State.  Better  laws  as 
well  as  better  wages  attract  better  workmen.  The  best  workmen 
are  attracted  to  those  industries  and  to  those  localities  where  con- 
ditions of  employment  are  most  satisfactory. 

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Our  many  inquiries  and  conferences  and  a great  deal  of  read- 
ing on  the  subject  have  led  us  to  conclude  that  of  even  greater 
benefit  than  workmen’s  compensation  to  the  wage-earners  and  their 
dependents  would  be  an  adequate  system  of  insurance  against  sick- 
ness, and  we  unhesitatingly  add  that  such  a plan  as  we  have 
outlined  would  also  be  of  very  great  advantage  to  industry. 

Sickness  an  Industrial  Waste 

Any  one  who  has  worked  at  a trade  or  who  has  had  opportunity 
for  wide  observation  of  the  conditions  of  living  and  of  labor  under 
our  modern  factory  system  must  admit  that  we  still  have  far  to  go 
before  such  conditions  are  perfect.  We  realize  that  the  best  inten- 
tioned  employer  is  continually  concerned  with  problems  of  shop 
management  which  are  aggravated  by  frequent  absences  of  em- 
ployees, often  on  account  of  their  own  sickness  incapacity  or 
because  there  is  no  one  else  to  stay  with  folks  who  are  sick  at  home. 
The  idle  machine  of  an  absent  employee  spoils  plans  for  immediate 
output,  but  there  is  also  a loss  on  account  of  the  capital  invested  in 
that  machine,  in  addition  to  a failure  to  use  to  full  capacity  the 
arrangements  for  heat,  light  and  power.  And  the  discord  in  one 
department  affects  other  processes  in  the  factory  when  expected 
material  is  delayed  on  account  of  one  sick  employee.  It  is  no 
answer  to  say  that  workmen  may,  under  Health  Insurance,  remain 
away  from  work  longer  when  sick.  Even  an  increase  in  the 
average  number  of  days  of  absence  may  be  directly  to  the  advan- 
tage of  the  employer.  It  is  much  better  for  all  concerned  that 
sick  workmen  remain  away  until  actually  well  enough  to  return 
and  do  a full  day’s  work.  The  results  of  a half-sick  workman 
sticking  to  the  job  when  he  ought  to  be  at  home  under  a doctor’s 
care,  are  almost  if  not  quite  as  bad  as  if  he  stayed  home  for  a 
day  or  two.  Damaged  mlaterial,  a botched  job,  bad  temper,  less 
output  and  reduced  efficiency  are  the  natural  results. 

But  more  than  that,  employers  have  learned  a great  deal  lately 
about  the  cost  of  filling  a place  with  a new  man.  Valuable  time 
must  often  be  spent  in  finding  <and  training  a substitute  to  take 
the  place  of  a workman  who  has  gotten  all  run  down  and  finally 
has  to  quit  his  job  for  a long  sick  spell.  The  inexperienced  work- 
man is  likely  to  damage  some  mater ilal,  or  the  tools  he  works  with, 
and  his  product  generally  is  inferior.  Even  the  most  skilled 

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workmen  who  have  to  adjust  themselves  to  new  conditions  experi- 
ence some  loss*  of  efficiency.  And  it  is  a well  known  fact  that  a 
much  greater  number  of  laccidents  to  the  workmen  themselves 
take  place  while  they  are  getting  acquainted  with  a new  machine. 
All  of  this  is  expensive  to  the  employer.  The  cost  of  this  “ labor 
turnover,”  as  the  efficiency  gentlemen  call  it,  we  find  estimated  at 
from  $10  for  ordinary  labor  to  as  high  as  $300  for  a highly 
skilled  mechanic.  Some  employers  say  on  an  average  $40  is  not 
far  out  of  the  way  for  the  cost  of  hiring  and  training  a new  man. 
Employees  do  not  need  to  be  told  that  the  chiange  is  also  expensive 
for  the  workman  who  loses  his  job  on  account  of  sickness. 

The  Lesson  of  Good  Health 

Careful  consideration  of  the  causes  of  much  of  this  waste  in 
industry  leads  our  committee  to  conclude  that  sickness  is  the 
problem  which  offers  the  best  chance  for  employers  and  their 
employees  to  work  together  for  the  reduction  of  such  losses.  We 
heartily  concur  in  Governor  Whitman’s  recent  statement  in  regard 
to  the  large  number  of  draft  rejections  on  physical  grounds,  that 
“ The  first  and  fundamental  lesson  which  should  be  taught  in  any 
system  which  has  for  its  purpose  the  preparation  of  a better  citi- 
zenry is  the  lesson  of  good  health  and  physical  well-being.”  It  is 
bad  enough  that  in  Hew  York  State  alone  there  are  315,000  indus- 
trial accidents  a year  which  cause  loss  of  time.  But  in  its  unani- 
mous report  favoring  health  insurance  the  Hew  Jersey  official 
commission  states  that  the  head  of  the  Hew  Jersey  Zinc  Com- 
pany’s technical  department  found  in  one  large  concern  four  times 
as  much  time  lost  from  illness  as  from  accidents.  The  carefully 
kept  records  of  an  extensive  factory  in  Worcester,  Mass,,  are  even 
more  striking,  for^  they  reveal  twelve  to  fourteen  times  as  much 
time  lost  through  sickness  as  through  accident.  Government 
investigators  working  on  these  problems  found  among  12,154 
heads  of  families  out  of  work  that  over  22  per  cent  were  unable  to 
work  because  of  sickness  and  7 per  cent  more  were  idle  for  other 
causes  combined  with  sickness.  Hot  even  old  age,  or  the  tempo- 
rary fluctuations  of  industry,  give  rise  day  in  and  day  out  to  so 
much  broken  time  or  so  urgently  call  for  vigorous  corrective  action 
by  employers  and  workmen  together.  This  is  why  the  Hew  Jersey 
commission,  originally  created  to  study  old  age  pensions,  has  now 

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with  the  approval  of  Governor  Edge  and  the  legislature  turned 
its  attention  entirely  to  health  insurance  as  the  nOxt  logical  step 
following  workmen’s  compensation. 

Medical  Care  an  Economy 

No  contribution  that  the  employer  can  make  toward  the  joint  so- 
lution of  this  problem  has  had  better  demonstrated  success  than  the 
provision  of  prompt  and  adequate  medical  care  for  sick  employes. 
A cash  benefit  for  a limited  period  of  sickness,  not  to  exceed  in  any 
case  more  than  twenty-six  weeks  in  any  one  year,  is  indeed  import- 
ant. Earlier  bills  provided  far  more  liberal  cash  benefits  than  we 
propose.  But  we  have  cut  down  the  cash  relief  to  a weekly  maxi- 
mum of  $8,  strongly  believing  that  adequate  medical  care  is  most 
important  under  health  insurance.  After  providing  such  medical 
care  the  Massachusetts  company  already  referred  to  found  that  the 
hours  per  year  lost  by  employees  who  took  advantage  of  its  hospital 
facilities  amounted  to  only  half  as  many  as  were  lost  by  those  who 
did  not  accept  this  care.  Right  in  this  .State  the  New  York  City 
Department  of  Health  in  1914  instituted  medical  supervision  of 
its  employees,  and  now  reports  that  this  service  has  “ resulted  in 
a material  reduction  in  the  number  absent  during  each  of  the  past 
three  years  because  of  illness.”  If  our  colleges  and  universities 
find,  as  one  institution  in  the  middle  west  has,  that  by  a system  of 
prompt  medical  treatment  for  students  without  extra  charge  the 
average  time  lost  can  be  reduced  from  eight  and  one-half  days  to 
two  and  one-half,  why  should  not  industry  avail  itself  of  the  same 
method  of  economy  ? The  results  actually  obtained  by  numerous 
careful  and  successful  private  industries  which  have  given  such 
attention  to  the  sickness  problem  have  amply  justified  the  efforts 
expended.  “ It  is  to  the  direct  interest  of  the  company  as  well  as 
the  individual,”  declares  a member  of  the  famous  silk  firm  of 
Cheney  Brothers,  li  to  bring  about  a re-establishment  of  health 
and  consequently  efficiency,  by  supplying  the  best  conditions  possi- 
ble for  recovery.”  The  modern  employer,  according  to  the  medi- 
cal director  for  the  Cincinnati  Milling  Machine  'Company,  “ has 
learned  that  the  health  of  the  worker  is  a definite  asset  in  his 
business.  Medical  care  in  industry  is  not  charity.  It  pays  good 
dividends.”  In  the  Western  Union  Telegraph  Company,  where 
a sick  benefit  fund  is  already  in  existence,  the  secretary  of  the  fund 


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reports  that  many  employees  have  been  enabled  to  have  ailments 
of  long  standing  corrected,  and  adds:  “ The  advantages  accruing 
to  the  company  in  such  cases  are  obvious.” 

Worth  All  It  Costs 

On  less  material  grounds,  also,  workmen’s  health  insurance  will 
be  of  benefit  to  those  in  charge  of  our  industries.  Says  the  presi- 
dent of  one  of  the  largest  European  associations  of  employers  in 
the  iron  and  steel  industry,  in  discussing  health  and  other  social 
insurance  laws:  M The  laws  ( pay  ’ employers  from  their  own  stand- 
point, since  they,  too,  are  given  a feeling  of  greater  security ; they 
are  freed  from  moral  and  material  burdens  which  the  individual 
standing  alone  would  hardly  be  able  to  bear.” 

Although  it  is  expected  that  the  worker’s  contribution  to  health 
insurance  will  cover  the  cost  of  the  medical  care  which  is  to  be 
provided  for  members  of  his  family,  a little  reflection  will,  we 
believe,  convince  any  fair-minded  person  that  this  feature  of  the 
insurance  plan  will  also  be  of  very  marked  benefit  to  industry. 
Ansley  K.  Balz,  a San  Francisco  employer  and  the  vice-chairman 
of  the  'California  commission  which  has  unanimously  reported  in 
favor  of  universal  workmen’s  health  insurance  with  employers  and 
employees  bearing  equal  proportions  of  the  cost,  observes  that 
“ Workers  running  in  debt  on  account  of  sickness  at  home  are 
worried  or  depressed.  This  reduces  the  quantity  and  quality  of 
their  work  and  increases  their  liability  to  sickness  and  accident.” 
“ Health  insurance,”  he  concludes,  iC  will  be  a benefit  to  employers, 
worth  all  that  they  will  be  called  upon  to  contribute.” 

An  Impulse  to  Prevention 

But  a pound  of  prevention  is  worth  a ton  of  cure.  We  all  know 
how  workmen’s  compensation  has  operated  to  reduce  fatal  and 
serious  industrial  accidents  and  stimulated  the  safety  movement 
from  one  end  of  the  country  to  the  other.  When  health  insurance 
funds  are  established  on  the  lines  we  advocate,  and  workmen  and 
employers  both  find  themselves  subjected  to  constant  financial 
reminders  in  the  form  of  joint  contributions,  we  need  not  be 
prophets  to  see  them  both  taking  steps  to  reduce  sickness.  “ There 
is  not  the  slightest  question  in  our  mind,”  says  Edmund  'N.  Huyck, 
of  Albany,  in  whose  manufacturing  plant  an  unusually  fair  estab- 


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lishment  system  of  health  insurance  ils  already  in  operation,  “ that 
it  has  made  us  more  alive  to  the  need  of  healthful,  sanitary  work- 
ing conditions ; and  that  it  has  been  worth  to  our  company  far 
more  than  it  cost  us.”  Mr.  Huyck’s  observation  of  the  effects  of 
sickness  care  among  hits  own  employees  has  led  him  to  say  of  the 
benefits  of  Health  Insurance: 

“ I know  that  it  is  far  more  important  than  workmen’s 
compensation,  and  I feel  that  all  arguments  against  it 
must  fall  and  that  finally  we  in  this  country  will  take 
the  position  of  those  countries  that  are  so  far  ahead  of  us 
in  social  insurance.  . . . When  it  is  in  full  oper- 

ation, both  employers  and  employees  will  be  better  citi- 
zens of  better  states.” 

Hot  only  medical  care  for  sick  employees,  but  the  prevention  of 
sickness  among  his  employees,  is,  we  submit,  sound  economy  for 
the  efficient  leader  of  industry.  Here  is  a problem  on  which  labor 
and  capital  can  and  should  cooperate  in  full  confidence  of  mutual 
benefits.  Edward  J.  Barcalo,  in  addressing  the  members  of  the 
Associated  Manufacturers  and  Merchants  of  Hew  York  State,  of 
which  he  was  then  President,  said:  “ We  have  accepted  the  prin- 
ciple of  compensation  for  injuries  to  workmen.  We  admit  it.  Ho'w 
there  is  another  matter  that  is  coming  up,  and  that,  iis  a part  of  the 
so  called  Health  Insurance  bill.  This  is  really  before  us.  We 
mustn’t  think  we  can  wave  it  aside.  We  can’t.”  And  then  he 
added : In  this  matter,  as  in  all  other  matters,  if  we  are  wise 

we  will  treat  with  the  other  side,  who  are  equally  interested  in  it.” 

Moreover,  as  the  favorable  Hew  Jersey  commission  report  on 
Health  Insurance  points  out, 

“ it  is  the  duty  of  statesmanship  to  look  beyond  our 
immediate  pressing  needs  to  the  period  of  reconstruction 
at  the  close  of  the  war.  We  cannot  afford  to  disregard 
the  protective  legislative  inducements  already  offered  to 
workmen  by  our  keenest  commercial  competitors  in 
Europe.” 

And  a former  representative  of  large  manufacturing  interests, 
now  in  the  War  Department,  recently  wrote: 

“ I believe  very  strongly  that  unless  we  make  very 
substantial  progress  along  the  line  of  Health  Insurance 
. . . we  shall  find  ourselves  under  very  serious 

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handicaps  in  world  competition  at  the  conclusion  of  the 
present  war.  I believe  that  many  of  our  people  are 
still  going  cheerfully  on  with  the  social  ideals  and  ideas 
of  the  past  generation  quite  oblivious  to  the  fact  that  our 
great  commercial  competitors,  Germany  and  Great  Brit- 
ain, have  advanced  far  beyond  us  in  social  thinking. 
The  time  will  come  within  the  years  immediately  follow- 
ing the  war  when  our  ‘ go  as  you  please 9 methods  of 
industry  will  be  weighed  in  the.  balance  in  competition 
with  Europe.” 


Cost  Equitably  Divided 

Mindful  of  the  burdens  which  industrial  managers  find  them- 
selves called  upon  to  carry  at  this  critical  time  in  our  nation’s 
history,  the  Committee  on  Health  has  considered  very  carefully 
the  various  methods  of  meeting  the  cost  of  this  insurance  against 
sickness.  One  group  of  radicals  suggested  loading  the  entire  cost 
upon  the  employer,  another  group  favored  putting  it  all  upon  the 
State.  We  have  thought  the  fair  and  reasonable  thing  to  do  is  to 
share  the  cost  equitably  between  the  two  groups  who  are  most 
directly  responsible  for  the  sickness  and  who  will  benefit  most 
directly  as  a result  of  improved  facilities  for  industrial  health 
conservation.  We  have  therefore  suggested  the  division  of  the  cost 
of  benefits  and  the  expenses  of  local  management  between  employees 
and  their  employers  on  a fifty-fifty  basis.  Hot  doubting  that  such 
a general  effort  to  improve  the  lot  of  the  sick  wage-earners  who 
are  least  able  to  bear  the  financial  burden  — which  has  too  long 
been  thrust  mainly  upon  them  alone  — will  eventually  result  also 
in  great  benefit  to  the  State,  which  is  itself  admittedly  responsible 
for  many  sickness  problems,  we  have  recommended  that  the  State 
bear  the  cost  of  general  supervision  as  is  already  done  in  work- 
men’s compensation.  This  will  provide  ample  assurance  that  the 
contributions  from  workmen  and  employers  will  be  regularly 
collected,  and  set  aside  in  a safe  manner  and  that  the  cash  benefits 
as  well  as  the  medical  services  will  be  managed  on  a sound  business- 
like basis.  The  necessity  for  such  careful  supervision  of  the 
mutual  funds  will,  we  believe,  be  apparent  to  those  who  have 
instituted  even  a superficial  study  of  certain  “ voluntary  ” schemes. 
We  regret  to  report  that  even  some  of  the  schemes  established  by 
certain  employers  for  the  avowed1  purpose  of  benefiting  their 
workmen  have  been  mismanaged.  We  believe  that  in  the  long  run 

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it  will  be  most  satisfactory  to  the  employers  as  a whole  to  have 
the  system  of  universal  Health  Insurance  under  careful  State 
supervision. 

Mutual  Management 

Still  more  advantageous  to  industry  than  even  the  general  State 
supervision  of  contributions  and  benefits  we  believe  is  the  plan  for 
mutual  management  of  the  local  administrative  organizations 
called  Health  Insurance  funds.  These  are  of  three  kinds  — local, 
or  trade,  or  establishment  funds  — so  as  to  inconvenience  industry 
as  little  as  possible  in  conforming  to  the  State-wide  plan.  The 
local  boards  of  directors  of  these  funds,  democratically  selected  in 
equal  numbers  by  the  employer  and  employee  members,  with  a 
seventh  member  representing  the  interested  public,  places  the 
actual  business  of  managing  and  conducting  the  Health  Insurance 
work  beyond  the  reach  of  politicians  as  well  as  beyond  the  com- 
mercial manipulations  of  insurance  company  agents.  Always 
under  careful  State  supervision,  it  places  the  direction  of  expen- 
ditures where  it  belongs  — in  the  hands  of  the  employers  and 
employees  who  are  paying  the  shot.  This  will  result  naturally  in 
the  careful  scrutiny  of  every  item  of  cost. 

This  method  of  checking  up  expenditures  is  objected  to  by  some 
of  the  doctors,  but  we  believe  employers  and  employees  will  be 
well  within  their  rights  in  so  safeguarding  expenditures.  The 
arrangement  for  a medical  officer  of  the  funds,  who  will  not  give 
medical  treatment  himself  but  who  will  supervise  the  work  of  the 
practicing  physicians  and  say  when  insured  employees  are  able  to 
go  back  to  work  after  periods  of  sickness,  we  feel  sure  will  be 
favored  by  all  employers  who  give  the  matter  serious  consideration. 
This  is  one  of  the  four  demands  of  the  American  Medical  Associa- 
tion, and  the  other  three,  including  provision  for  adequate  repre- 
sentation in  the  administration,  free  choice  of  physician,  and 
payment  in  accordance  with  services  rendered,  have  also  been  met 
in  the  bill  we  have  submitted. 

More  than  that  the  system  of  local  management  brings  regularlv 
and  frequently  to  the  attention  of  those  most  vitally  concerned  the 
dollar-and-cents  measure  of  the  price  we  pay  for  physical  unfitness. 
The  whole  cost  of  sickness  is  already  being  paid  for  somewhere 
bv  somebody.  Under  our  present  lack  of  system  the  real  sufferers, 
both  employers  and  workmen,  are  sometimes  hidden.  The  plan 

12 


we  propose  will  let  in  the  light.  If  as  the  foremost  medical  author- 
ities tell  us  in  regard  to  the  draft  rejections  “ 60  per  cent  of 
physical  unfitness  is  due  to  preventable  causes/’  then  we  will  have 
under  mutually  supported  and  mutually  managed  Health  Insur- 
ance a common  interest  with  our  employers  in  working  toward 
the  prevention  of  all  avoidable  sickness.  The  bill  we  have  sub- 
mitted specifically  provides  the  way  for  the  prevention  of  disease 
and  for  the  education  of  both  employers  and  employees  in  disease 
prevention  and  hygiene.  We  believe  there  is  great  need  of  such 
instruction  and  we  submit  that  it  is  only  common  sense  to  expect 
that  the  same  economic  forces  which  developed  out  of  workmen’s 
compensation  the  movement  for  “ Safety  First/’  will  through 
such  a plan  of  health  insurance  give  great  impetus  to  a campaign 
for  physical  fitness. 

Favorable  Sentiment  Developing 

We  believe  it  is  true  that  the  majority  of  employers  are  earn- 
estly desirous  of  affording  every  practical  humane  provision  for 
the  care  of  their  sick  employees.  We  know  that  some  are  already 
bearing  an  expense  far  greater  for  this  purpose  than  even  the 
liberal  medical  provisions  of  this  Health  Insurance  bill  will 
require.  But  we  also  know  that  without  a general  measure  under 
State  supervision  very  many  employers  — and  frequently  those 
owning  establishments  where  sanitary  conditions  are  the  worst  — 
will  continue  to  ignore  the  demands  of  simple  justice  to  the  work- 
ing men,  women  and  children  in  their  factories.  Our  appeal  for 
cooperation,  therefore,  must  be  to  the  more  humane  and  enlight- 
ened employers  and  we  must  expect  for  a time  to  meet  even  the 
abuse  of  some  of  the  less  enlightened  or  less  scrupulous.  Even- 
tually, however,  the  employers  as  a whole  will,  we  firmly  believe, 
see  the  advantages  to  industry  of  workmen’s  Health  Insurance  as 
they  have  already  done  in  the  actual  operation  of  workmen’s  com- 
pensation laws.  We  have  studied  this  question  of  Health  Insur- 
ance. We  are  giving  our  reasons  for  favoring  it  in  a series  of 
published  pamphlets.  It  is  therefore  unnecessary  for  us  to  adopt 
the  tactics  of  some  opponents  of  Health  Insurance.  We  do  not 
need  to  resort  to  the  questioning  of  motives. 

One  of  the  things  that  has  incidentally  arrested  our  attention 
as  we  have  examined  the  various  possibilities  of  Health  Insurance 

13 


administration  on  a democratic  basis,  is  the  opportunity  thus 
offered  both  to  employers  and  employees  to  learn  the  advantages 
of  working  together.  If  the  world  war  for  democracy  for  which 
workmen  by  the  millions  are  pouring  out  their  life  blood  and  for 
which  employers  by  the  thousands  are  unselfishly  spending  their 
wealth,  is  to  result  in  permanently  improved  conditions  for  those 
who  must  in  their  daily  toil  in  work  shops  suffer  the  hazards  of 
occupational  disease  and  premature  death,  it  must  come,  in  this 
country  especially,  through  a more  democratic  relationship  between 
employers  and  employees  in  the  day-by-day  working  life  of  our 
industries.  We  believe  ardently  in  our  trade  union  organizations, 
and  we  believe  thoroughly  in  organizations  of  employers.  We  are 
convinced  that  the  group  selection  of  representatives  to  serve  each 
interest  in  the  local  management  of  Health  Insurance  funds  will 
create  a much  needed  feeliiig  of  solidarity  of  interest  on  each  side. 
We  believe,  furthermore,  that  most  friction  resulting  in  open 
hostility  between  workmen  and  their  employers  might  be  removed 
“ at  the  source  ” if  there  were  more  just  such  opportunities  for 
workmen  and  their  employers  to  consult  together  over  such  matters 
of  common  interest  as  the  conservation  of  the  health  and  efficiency 
of  the  workers. 


Time  Ripe  for  Action 

Our  long  study  of  Health  Insurance,  which  merely  supplements 
our  many  years  of  practical  experience  in  dealing  with  labor 
problems  and  problems  of  factory  sanitation  and  industrial  safety 
and  hygiene,  leads  us  to  the  conclusion  that  the  time  is  more  than 
ripe  for  legislative  action.  We  conclude  that  Health  Insurance 
mutually  managed  and  mutually  supported  at  actual  cost  under 
the  supervision  of  the  State,  will  be  even  more  than  workmen’s 
compensation  is  a benefit  to  employees,  and  we  do  not  hesitate  to 
add  that  if  ejmployers  will  (show  a spirit  of  cooperation  Health 
Insurance  will  soon  be  recognized  as  equally  beneficial  to  industry. 

In  conclusion,  we  feel  that  we  can  not  sum  up  better  than  by 
calling  as  a witness  Francis  King  Carey,  President  of  the 
National  Sugar  Manufacturing  Company,  one  of  America’s  large 


14 


employers  of  labor,  who  in  a printed  letter  under  date  of  March 
1,  1918,  to  the  General  Assembly  of  Maryland,  writes: 

“ Health  Insurance  is  in  fact  a i full  sister  ’ 
of  workmen’s  compensation,  and  only  takes  up 
the  subject  where  workmen’s  compensation 
leaves  off.  In  this  connection  it  is  most  inter- 
esting to  note  that  practically  every  argument 
which  is  now  made  against  Health  Insurance 
was  made  with  great  vehemence  by  the  same 
interests  against  workmen’s  compensation.  It 
will  be  remembered  that  it  was  loudly  argued 
that  workmen’s  compensation  was  rank  social- 
ism ; that  it  was  a form  of  charity ; that  it  would 
impair  the  self-respect  of  the  employees ; that  it 
would  ruin  the  accident  insurance  companies; 
that  it  would  put  an  unbearable  burden  upon 
the  employer.  Even  in  the  short  time  which 
has  elapsed  since  state  after  state  has  wheeled 
into  line  on  the  subject  of  workmen’s  compen- 
sation every  one  of  these  ‘ ghosts  ’ has  been 
laid,  and  the  same  will  be  true  of  the  ghosts 
which  are  being  raised  by  the  enemies  of 
Health  Insurance.” 

We  submit  tbis  report  more  than  ever  convinced  that  Health 
Insurance  will  be  found  in  practice  a most  beneficent  measure  both 
for  industry  and,  for  the  wage-earners,  and  we  note  with  satis- 
faction the  rapidly  developing  public  Sentiment  in  its  favor. 

For  the  Committee  on  Health, 

JAMES  M.  LYNCH,  Chairman ; 
y WILLIAM  HANDER,  Vice-Chairman ; 

J.  M.  O’HANLON,  Secretary. 


15 


New  fork  ^tate  iFeieration  of  ICahor, 


NINTH  REPORT  OF 


COMMITTEE  ON  HEALTH 


Subject / HEALTH  INSURANCE 


Eleventh  Annual  New  York  City  Conference 
of  Charities  and  Corrections.  The  principal 
paper  was  read  by  JAMES  M.  LYNCH,  and 
because  of  its  value  in  setting  forth  the  effects 
of  sickness  on  wage-earners,  the  Committee 
on  Health  of  the  New  York  State  Federation 
of  Labor  reproduces  it  herewith  as  its  ninth 
report  on  the  subject  of  Health  Insurance. 


1920 


\ — — — 

REPORTS  ON  HEALTH  INSURANCE. 

1.  Official  Endorsement  of  New  York  State  Federation  o< 

Tabor  with  report  of  Committee  on  Health. 

2.  Discussion  of  Health  Insurance  Bill  of  New  York  State 

Federation  of  Tabor  (To  accompany  Senate 
Print  692,) 

3.  Advantages  to  Industry  of  Workmen' s Health  Insurance. 

4.  A Demand  for  the  Passage  of  a Health  Insurance  Lavj. 

5.  Progress  toward  Health  Insurance  Legislation. 

6 Opposition  Attempts  to  Mislead  Workers. 

7.  Digest  of  the  Speech  of  Hon.  Frederick  M.  Davenport  on 

April  lo,  1919. 

8.  What’s  Tour  Health  Worth  ? 

9.  Effects  of  Sickness  on  Wage  Earners. 


The  above  reports  a'nd  accompanying  bill  for  Health 
Insurance  maj  be  had  upon  application  to  Secretary-Treas- 
urer Edward  A.  Bates,  New  York  State  Federation  of  Tabor, 
Arkay  Building,  Albany,  N.  Y. 


SICKNESS  IN  INDUSTRY  AS  A CAUSE  OF  POVERTY 
— AND  A REMEDY  THEREFOR 


BY  JAMES  M.  LYNCH 


All  wage-earners  and  their  families  understand  the  grim  truth 
of  the  saying,  “When  the  breadwinner  falls  ill,  the  wolf  is  at  the 
door.’’ 

Charity  organization  societies,  too,  know  at  first  hand  how 
great  are  the  individual  and  social  ravages  of  sickness.  Every- 
where, at  all  time^  sickness  is  the  greatest  single  cause  of  de- 
pendency. 

So  at  the  outset  let  us  fix  our  minds  upon  two  facts  that  go 
to  the  very  heart  of  the  present  discussion: 

( 1 ) Sickness  is  to  blame  for  fully  half  of  the  calls  upon  charity. 

(2)  Nearly  half  of  the  vast  sums  now  being  spent  by  public 
and  private  charities  because  of  illness  among  wage-earners  will 
be  made  unnecessary  by  the  adoption  of  workmen’s  health  insur- 
ance laws. 

CHARITY  ODIOUS,  BUT  UNAVOIDABLE 

The  American  workman  will  endure  almost  any  hardship  rather 
than  resort  to  charity,  but  sickness  with  its  expenses  and  loss  of 
earnings  is  the  “last  straw,”  forcing  him  down  into  dependency. 
First  his  savings  go,  then  comes  deprivation,  debts  to  physician, 
landlord  and  grocer,  loans  from  friends  and  commercial  agencies, 
and  finally  destitution. 

The  tragedy  of  sickness  to  the  wage-earner  has  been  vividly  " 
suggested  by  Warren  J.  Pillsbury  of  the  California  Industrial 
Accident  Commission  in  urging  compulsory  health  insurance  as 
the  only  effective  and  economical  method  of  coping  with  illness 
among  workers,  now  so  costly  a burden  to  society. 

ILLNESS  AND  ITS  CONSEQUENCES 

“The  present  method  of  handling  illness  of  wage-earners,”  he 
says,  “is  as  follows:  The  workman,  becoming  ill,  struggles  to 
remain  at  work  as  long  as  possible  to  avoid  loss  of  wages,  and 
refuses  to  go  to  a physician  until  the  last  moment  because  of 


4 


fear  of  expense,  thus  preventing  treatment  at  the  time  it  is  most 
effective,  the  early  stages  of  the  illness.  When  finally  obliged 
to  leave  work,  the  income  of  himself  and  his  family  is  ended. 
His  savings  will  seldom  last  for  more  than  a week  or  two  of 
idleness.  He  then  becomes  a charge  upon  relatives,  friends  and 
public  charity.  Worry  over  his  financial  condition  prolongs  his 
illness.  Inability  to  procure  necessary  medical  and  surgical  appli- 
ances or  to  take  proper  rest  or  sanatorium  treatment  delays  re- 
covery. The  children  are  taken  from  school  prematurely  and 
put  to  work  without  adequate  preparation,  or  allowed  to  go  upon 
the  streets.  Eventually  he  may  go  to  the  county  hospital  for  a 
long  period  of  time,  and  his  wife  will  be  taken  care  of  by  the 
Associated  Charities,  or  will  undertake  work  beyond  her  strength 
and  in  turn  become  ill.  The  employer  has  tdi  break  a new  man 
into  the  work.  The  community,  friends,  or  relatives  have  to 
support  the  family,  and  the  man  is  inefficiently  or  haphazardly 
taken  care  of  because  of  lack  of  organized  social  endeavor  to 
meet  the  problem  presented.” 

IT  IS  A PICTURE  REPELLANT  BUT  FAMILIAR 

This  picture  of  the  road  to  ruin  down  which  so  many  worthy, 
industrious,  self-respecting  working  mens  families  are  driven  by 
sickness,  is  sadly  familiar  to  all  of  us  who  come  into  day-by-day 
contact  with  the  misery  visited  upon  the  toilers  by  accident  and 
disease.  And  it  is  because  the  number  thus  stricken  is  so  great 
— and  the  social  consequences  so  grave  — 1 that  we  in  this  coun- 
try are  setting  about  with  facts  and  experiences  and  enlightened 
purpose  to  provide  an  adequate  remedy. 

We  now  have  available  the  findings  of  recent  investigations 
by  eleven  official  state  commissions  into  sickness  conditions 
among  workers.  These  studies  — notably  those  in  Illinois,  Ohio, 
Pennsylvania,  California,  Massachusetts,  New  Jersey  and  New 
York  — present  a vast  body  of  illuminating  data,  covering  widely 
separated  and  diversified  industrial  sections.  And  they  are  in 
striking  and  significant  agreement  as  to  the  appalling  extent  of 
sickness  among  wage-earners  — an  extent  even  greater  than  has 
hitherto  been  suspected. 

WE  WERE  SURPRISED  AT  DRAFT  REVELATIONS 

Still  fresh  in  our  minds  are  the  shocking  revelations  of  the 
draft  as  to  the  physical  unfitness  of  American  manhood  at  the 


5 


ages  when  one  would  expect  to  find  the  very  pink  of  cond  tion. 
In  New  York,  for  instance,  nearly  ONE-HALF  the  young  men 
of  2 1 to  30  were  rejected  because  they  failed  to  meet  the  ph  sical 
standards  for  military  service!  The  same  high  percentage  was 
found  in  Pennsylvania,  another  great  industrial  state.  The  aver- 
age for  the  country  as  a whole  was  nearly  one-third.  Truly  a 
situation  taking  first  rank  among  social  problems. 

But  what  was  thus  disclosed  with  respect  to  young  men  in  all 
groups  has  now  been  amply  supplemented  by  official  findings 
with  respect  to  the  wage-earning  groups  of  all  ages.  It  is  helpful 
to  an  understanding  of  the  relation  between  sickness  and  poverty 
and  dependency  to  examine  a few  of  the  principal  facts  as  to  the 
crushing  economic  effects  of  sickness  upon  the  workers. 


AN  INVESTIGATION  OF  GREAT  VALUE 

From  the  Illinois  investigation,  which  is  one  of  the  most  search- 
ing and  illuminating  inquiries  into  this  subject  that  has  yet  been 
made,  we  learn  that  one-third  of  the  men  asking  for  work  in 
eight  Illinois  manufacturing  plants,  according  to  the  company 
doctors,  were  found  to  be  “diseased  and  defective.”  About 
one-fifth  of  these  men  were  refused  jobs  because  the  doctors 
found  them  physically  unfit  for  work.  And  here  is  raised  an 
interesting  question.  What  became  of  these  men?  Did  they 
get  medical  aid  until  well  enough  to  work,  or  did  they  go  to 
work  — sick  as  they  were  and  possibly  to  the  permanent  injury 
of  their  health  — for  employers  who  were  not  so  particular? 
Or  did  they  become  submerged  in  the  army  of  the  permanently 
incapacitated  and  unemployed  — human  derelicts? 

The  investigation  discloses  that  between  20  per  cent  and  30 
per  cent  — nearly  ONE-THIRD  — of  ALL  workers  are  so  sick 
that  they  have  to  remain  away  from  work  for  eight  days  or  more 
during  every  year.  Time  lost  IN  A YEAR  by  workers  who  are 
sick  varied  from  29  days  among  those  in  a grbup  of*  “company 
funds”  to  31  days  among  those  discovered  by  house-to-house 
inquiries.  Among  workers  who  are  sick  for  more  than  a week, 
two  out  of  three  will  be  sick  for  four  weeks  or  less;  one  out  of 
five  will  be  sick  from  four  to  eight  weeks;  one  out  of  fourteen 
will  be  sick  from  eight  to  twelve  weeks. 


6 


IN  AGREEMENT  WITH  PREVIOUS  INQUIRIES 

The  Illinois  state  investigation,  in  agreement  with  official  studies 
in  other  industrial  states,  shows  that  the  wage-earners  lose  many 
millions  of  dollars  every  year  because  of  illness  and  that  large 
numbers  are  thus  forced  over  the  line  from  independence  into 
dependency.  In  Illinois  it  is  found  that  each  year  the  workers 
lose  in  wages  alone  because  of  sickness  the  large  sum  of 
$46,000,000,  while  in  addition  they  have  to  pay  out  each  year 
about  $1  1,000,000  for  medical  care.  This  runs  about  the  same 
as  for  the  other  states;  in  Pennsylvania,  for  instance,  the  yearly 
wage  loss  due  to  sickness,  figured  at  the  rate  of  $2  a day,  is 
$33,000,000;  in  New  York  it  is  $40,000,000. 

The  Illinois  report  shows,  significantly,  that  families  having 
' the  LOWEST  WAGES  have  the  MOST  SICKNESS.  These  low 
wage  families  are  most  often  obliged  to  run  into  debt  because 
they  are  unable  to  bear  the  entire  expense  of  sickness.  Workers’ 
families  having  sickness  fall  into  debt  three  times  as  frequently 
as  families  having  no  sickness.  Wage-earners  with  large  families 
of  children  under  fourteen  most  frequently  fail  to  stand  up  under 
the  crushing  burden  of  sickness  and  are  forced  to  seek  charity. 
Many  families  visited  by  sickness  preferred  to  undergo  severe 
hardships  rather  than  appeal  to  charity.  For  every  family  that 
asked  for  charity,  it  was  found,  three  families  met  their  reverses 
due  to  sickness  by  leaving  their  bills  unpaid,  and  two  families  sent 

wives  or  children  out  to  earn  money.  - 

* 

“The  basic  fact  stands  out,”  the  commission  concludes,  “that 
the  great  majority  of  families  with  only  one  breadwinner  and 
four  or  more  children  not  over  fourteen  years  of  age  are  already 
in  poverty,  just  at  the  edge  of  despondency.  An  acute  illness 
pushes  the  family  into  dependency  because  of  its  necessary  hand- 
to-mou^th  existence.” 

SICKNESS  AS  A CAUSE  OF  DESTITUTION 

A special,  intensive  investigation  was  made  by  the  Illinois 
commission  into  sickness  as  a cause  of  poverty.  Briefly  it  was 
found  that 

1 . Eight  charity  organization  societies  outside  of  Chicago  at- 
tribute to  sickness  chief  responsibility  in  upward  of  one-third  of 
the  cases  seeking  relief  in  the  year  1917-18; 

r 


7 


2.  One-fourth  of  the  poverty  in  Chicago  in  1917-18  in  the 
wage-earning  families  of  the  block  study  was  accounted  for  by 
the  loss  of  wages  and  sickness  costs  involved  in  disabling  illness; 

3.  An  intensive  study  of  a group  of  charity  families  indicated 
that  the  majority  of  these  families  had  been  economically  inde- 
pendent prior  to  disabling  illness;  that  the  dependency  risk  due 
to  sickness  varied  directly  with  the  lower  economic  status  of  the 
family,  and  that  chronic  diseases,  including  tuberculosis,  were 
responsible  for  two-fifths  to  one-half  of  all  dependency  resulting 
from  physical  disability; 

4.  On  the  basis  of  a study  of  the  experience  of  charitable 
agencies  in  Chicago  (covering  eight  years)  sickness  was  charged 
with  ONE-THIRD  to  ONE-HALF  of  all  the  causes  or  problems 
entering  into  dependency; 

5.  A CONSTANT  and  more  or  less  definite  FRACTION 
of  POVERTY  and  DEPENDENCY  MUST  BE  CHARGED  to 
disabling  SICKNESS  of  the  wage-earner  and  the  members  of 
his  family. 

NOT  A NEW  STORY  TO  STUDENTS  OF  THE  PROBLEM 

TTie  condition  here  demonstrated  has  long  been  recognized  by 
those  engaged  in  relief  work  and  in  combatting  conditions  that 
lead  to  economic  distress  and  destitution.  The  New  York  State 
Board  of  Charities  in  its  annual  report  for  1918  states  that 

“The  health  of  working  men  and  their  families  is  as  a general 
thing  poorly  looked  after.  The  sick  one  is  apt  to  keep  about  his 
work  after  he  has  become  ill  and  even  when  compelled  to  stop 
will  often  delay  calling  a physician.  Likewise  he  will  return  to 
work  sometimes  before  he  is  able  to  do  so.  A large  amount  of 
the  funds  contributed  by  private  charities  for  the  care  of  families 
in  their  homes  is  made  necessary  because  of  illness.  Studies  of 
charitable  work  have  made  the  proportion  more  than  50  per 
cent.  In  a study  of  31,481  charity  cases  by  the  United  States 
Immigration  Commission  in  1909,  sickness  was  a factor  in  38.3 
per  cent  of  the  total  number.  At  least  half  of  this  expenditure 
would  be  met  in  whole  or  in  part  by  a system  of  health  insurance. 
About  60  to  80  per  ^cent  of  the  expenditures  of  the  New  York 
Association  for  Improving  the  Condition  of  the  Poor  is  for  relief 
made  necessary  by  sickness.  Of  the  75,000  persons  whom  the 


\ 


8 


Boston  District  Nursing  Association  aid  every  year,  nearly  50 
per  cent  are  unable  to  pay  for  nursing  care.  The  Buffalo  Charity 
Organization  Society  reports  that  for  1916  more  than  78  per  cent 
of  the  poverty  was  due  to  sickness.” 

■ • 

FACTS  GATHERED  IN  THE  GREATER  CITIES 

More  recently  as  the  result  of  an  investigation,  Dr.  Louis  I. 
Harris  of  the  New  York  City  Department  of  Health  stated  in  an 
article  in  the  New  York  Times: 

“The  facts  gleaned  in  this  investigation  cannot  but  help  to 
give  cne  whose  point  of  view  is  at  all  altruistic  a revelation  of 
the  need  for  health  insurance  because  it  shows  how  any  illness 
may  overthrow  the  econorrfic  balance  which  has  been  precariously 
maintained  by  a family  and  conversely  it  shows  how  illness  may 
be  produced  or  aggravated  or  recovery  retarded  by  general  eco- 
nomic changes.” 

A study  by  the  Pennsylvania  health  insurance  commission  of 
the  cases  coming  to  the  United  Hebrew  Charities  of  Philadelphia 
show  that  for  the  last  five  years  sickness  has  figured  as  the  main 
problem  in  each  year’s  worjo  — - running  from  39  per  cent  to  65 
per  cent.  Seven  Pennsylvania  cities,  through  their  associated 
charities,  furnished  detailed  information  showing  that  illness  was 
the  main  factor  in  dependency  of  4 1 per  cent  of  the  families  in 
one  city;  54  per  cent  in  another;  and  for  the  rest,  respectively, 
44  per  cent;  88  per  cent;  and  90  per  cent.  Says  the  commis- 
sion’s report: 

“In  1914-15,  the  great  year  of  unemployment,  in  the  10,488 
families  asking  aid  from  the  Philadelphia  Society  for  Organizing 
Charity  the  problems  of  unemployment  numbered  4,237,  while 
the  illness  problems  were  3,867,  a difference  of  but  870.  This 
is  another  instance  of  the  fact  that  even  in  a panic  year,  where 
one  reason  for  dependency  asserts  itself  so  strongly,  sickness  is 
a steady  factor.” 

OHIO  INQUIRY  LEADS  TO  THE  POORHOUSE 

Tie  trail  of  sickness  disaster  leads  not  only  to  charity;  all  too 
frequently  it  goes  on  to  end  in  the  poorhouse.  The  state  investi- 
gation in  Ohio  covering  22  typical  county  infirmaries,  uncovered 
the  fact  that  more  than  29  per  cent,  or  nearly  one-third,  of  those 
in  the  poorhouses  have  been  driven  there  by  disease. 


9 


“In  the  ordinary  Ohio  county  infirmary,”  says  the  report, 
“those  temporarily  sick,  the  hobo,  the  permanently  disabled  by 
sickness  or  accident,  the  feeble-minded,  the  partially  insane,  the 
epileptic,  the  old  and  infirm  and  the  deformed  represent  the 
different  types  to  be  found.  * * * Of  the  2,260  infirmary 

inmates  of  whom  a detailed  study  was  made,  it  was  possible  to 
obtain  information  in  regard  to  the  most  important  cause  of  pov- 
erty in  1,608  cases.  Disease,  sickness  or  accident  was  given  as 
the  most  important  cause  of  dependency  in  29.9  per  cent  of  the 
total  number  of  cases.” 


WAGE  EARNERS  RESIST  LAST  RESORT  TO  CHARITY 

It  must  be  said  in  passing  that  these  investigations  all  show  the 
most  desperate  resistance  by  the  workers  and  their  families  against 
being  forced  upon  charity  by  sickness.  Those  large  masses 
whose  low  wage  scales  keep  them  always  dangerously  close  to 
the  bare  margin  of  existence  are  the  first  to  fall  into  dependency 
when  stricken  by  illness;  nevertheless,  they  are  found  bravely 
resorting  to  all  possible  expedients  rather  than  appeal  to  charity. 
Here  is  a tribute  to  the  self-respect  of  the  American  workingman  I 

Light  is  thrown  on  this  aspect  of  the  problem  by  studies  made 
of  small  chattel  loans  advanced  to  workers  by  commercial  loan 
agencies.  The  Morris  Plan  bank  of  New  York  City  — where 
some  70  per  cent  of  all  the  loans  were  under  $100  and  30  per 
cent  under  $50  — reports  that  sickness  and  death  constitute  the 
most  frequent  cause  for  borrowing  — an  experience  not  unlike 
that  of  the  relief  societies.  The  Ohio  health  insurance  commis- 
sion secured  information  from  remedial  loan  societies  throughout 
the  country  asking  for  information  as  to  the  extent  to  which  loans 
were  made  on  account  of  sickness.  In  those  cities  which  have 
established  Morris  Plan  banks  or  similar  institutions  thousands 
of  working  men  avail  themselves  of  this  means  of  borrowing  upon 
their  own  credit  when  need  arises.  In  this  group,  which  more 
nearly  represents  the  rank  and  file  of  the  more  substantial  work- 
ers, the  evidence  of  the  burden  of  sickness  is  plain.  The  Chicago 
Morris  Plan  bank,  for  instance,  compiled  statistics  in  February, 
1918,  for  6,510  loans  and  the  results  showed  that  20  per  cent 
were  made  on  account  of  sickness  and  death.  Reports  received 
from  2 1 states  and  the  consensus  of  statistics  and  opinions  as 
to  remedial  loan  institutions  generally,  show  that  from  30  to  50 


10 


per  cent  of  loan*,  were  due  to  sickness  — impressive  evidence  of 
the  burden  of  sickness. 

SICKNESS  DOES  NOT  WORK  ACCORDING  TO  RULE 

The  economic  disaster  so  caused  by  sickness  is  due  to  the 
uncertainty  with  which  sickness  visits  the  individual.  The  indi- 
vidual cannot  foresee  the  occurrence  of  illness  nor  its  duration; 
if  he  is  to  have  adequate  protection  he  must  be  prepared  at  all 
times  to  defray  the  expenses  of  a maximum  period  of  illness. 
But  this  maximum  provision  by  each  individual  is  financially 
impossible.  Moreover,  provision  for,  say,  six  months’  illness  by 
each  individual,  even  if  it  were  possible,  would  be  unduly  extrav- 
agant. Sickness  distributed  among  all  workers  averages  about 
nine  days  a yeat.  This  sickness  is  confined  to  something  like 
20  to  30  per  cent  of  the  workers;  and  of  these,  illness  of  six 
months’  duration  is  limited  to  approximately  3 per  cent.  From 
the  standpoint  of  sickness  prevalence  alone,  it  is  wholly  unneces- 
sary that  every  individual,  sometimes  at  the  sacrifice  of  present 
necessities,  should  prepare  himself  to  meet  the  misfortune  which 
will  annually  overtake  less  than  one  per  cent  of  the  entire  group. 
The  economical  method  would  be  to  pool  the  savings  for  sick- 
ness, each  contributing  to  a central  fund  sufficient  to  cover  the 
annual  average  of  nine  days’  sickness  — a fund  from  which  the 
20  to  30  per  cent  who  are  sick  may  draw.  The  whole  problem 
is  one  for  practical  application  of  the  insurance  principle.  It  is  a 
social  problem;  the  remedy  lies  in  social  insurance. 

PRIVATE  HEALTH  INSURANCE  AS  A REMEDY 

It  is  true  that  recognition  of  the  advantages  of  the  insurance 
method  has  already  led  to  the  development  in  this  country  of 
health  insurance  by  commercial  insurance  companies,  establish- 
ment funds,  -fraternal  organiations,  and  trade  union  funds.  But 
official  investigations  have  shown  that  only  a small  portion  (in 
Illinois  it  was  found  to  be  less  than  ONE-THIRD)  of  the  wage- 
earners  are  protected  against  sickness  by  any  form  of  insurance; 
that  the  payments  are  insufficient;  that  the  benefits  rarely  include 
necessary  medical  care;  that  commercial  insurance  is  highly  ex- 
pensive and  limited  mostly  to  mere  funeral  money;  and  that  those 
who  need  insurance  most  — the  low-wage  families,  who  are 
closest  to  the  line  of  dependency  -7—  are  now  without  it. 


1 1 


Figures  show  that  workers  who  carry  industrial  life  insurance 
in  the  stock  companies  operating  for  profit  have  to  pay  $ 1 for 
every  60  cents  that  is  returned  to  them  in  burial  benefits.  The 
other  40  cents  is  taken  to  pay  heavy  office  expenses,  agents* 
commissions  and  profits. 

WHAT  WILL  FOLLOW  STATUTE  HEALTH  INSURANCE 

Adoption  of  workmen’s  health  insurance  laws  in  the  United 
States,  similar  to  the  bill  now  before  the  people  of  New  York 
State,  will  be  followed  with  marked  benefits  in  distributing  the 
burden  of  sickness  losses,  covering  sickness  costs  and  eliminating 
or  reducing  disastrous  deficits  that  are  driving  workers  into  pov- 
erty arid  dependency. 

The  painstaking  investigation  in  Illinois  in  this  connection  has 
brought  out  the  encouraging  estimate  that  of  a group  of  families 
experiencing  downward  shifts  in  economic  status  due  to  sickness, 
30  per  cent  would  have  had  sickness  costs  completely  covered 
under  health  insurance  legislation,  and  approximately  85  per 
cent*  would  have  had  them  either  covered  or  considerably  re- 
duced (60  per  cent  or  over)  ; that  the  proposed  health  insurance 
law  would  have  PREVENTED  a considerable  proportion  of 
poverty  and  dependency  caused  by  sickness;  that  the  reduction 
in  poverty  caused  by  the  year’s  sickness  would  have  been  about 
three- fourths;  and  that  the  highest  reduction  to  be  expected 
through  workmen’s  health  insurance,  in  the  cases  of  dependency 
caused  by  sickness,  is  ONE-HALF. 

BURDEN  OF  SICKNESS  BORNE  BY  TOILERS 

It  must  be  remembered  that,  aside  from  public  and  private 
charity,  the  burden  and  the  cost  of  sickness  under  existing  condi- 
tions is  borne  entirely  by  wage-workers.  This  is  unjust  and 
anti-social.  Industry  is  partly  responsible  for  the  sickness  of 
wage-workers.  Careful  studies  have  indicated  that  industry  is 
responsible  for  about  one-half  of  the  workers’  illness.  Industry 
is  certainly  responsible  to  the  extent  that  unhealthful  conditions 
of  work  tend  to  breed  sickness  among  workers.  The  whole  com- 
munity, too,  is  responsible  at  least  in  the  degree  that  it  fails  to 
take  preventive  measures  against  disease  and  epidemic.  Among 
the  contributory  causes  of  sickness  for  which  industry  itself  is 
responsible  may  be  mentioned  unsanitary  work  places;  fatigue 


12 


due  to  standing,  noise,  monotonous  work;  speeding  up  due  to 
piece  >vork;  working  seven  days  a week;  alternating  day  and 
night  shifts;  and  long  hours. 

In  a very  few  kinds  of  industrial  illness,  such  as  lead  poisoning 
and  anthrax,  the  direct  responsibility  of  industry  can  be  clearly 
proved,  and  such  sicknesses  are  termed  occupational  diseases. 
It  is  possible  to  furnish  protection  in  such  cases  through  work- 
men’s compensation'  laws,  but  even  then  only  a very  little  meas- 
ure of  relief  is  afforded  because  the  number  of  occupational  dis- 
ease cases  compensated  is  very  small  compared  with  accidents, 
and  smaller  still  when  compared  with  the  total  amount  of  sick- 
ness among  wage-earners. 

INDUSTRIAL  DISEASES  NOT  FULLY  DEFINED 

Dr.  Alice  Hamilton,  a medical  expert,  well-known  authority 
on  occupational  diseases,  and  member  of  the  Illinois  health  in- 
surance commission,  points  out:  “It  is  safe  to  say  that  the  greater 
part  of  industrial  sickness  of  which  industry  is  either  an  exciting 
or  contributory  cause,  is  not  yet  recognized  as  industrial  nor  pro- 
vided for  by  law.’’ 

The  United  States  Public  Health  Service,  in  a favorable  report 
on  the  relation  of  workmen’s  health  insurance  to  the  public 
health,  says  that  “there  is  no  longer  any  doubt  that  modern  in- 
dustry is  responsible  for  a considerable  proportion  of  working- 
men’s physical  ills.’’ 

The  Pennsylvania  commission  informs  us  that  “79  per  cent  of 
all  the  deaths  of  persons  of  working  age  in  one  year  were  from 
diseases  whose  connection  with  important  Pennsylvania  industries 
has  been  established.’’ 

INDUSTRY  SHOULD  PAY  HALF  THE  COST 

Industry,  therefore,  should  bear  half  the  cost  of  workmen  s 
health  insurance.  The  worker,  by  assuming  the  other  half  of  the 
cost,  will  take  care  of  the  full  proportion  of  sickness  for  which 
he,  himself,  is  responsible.  Organized  labor  in  America  is  strongly 
demanding  sickness  protection,  including  maternity  benefits.  The 
workers  have  known  at  first  hand  the  deplorable  conditions  now 
so  clearly  proved  by  all  these  official  investigations.  That  is 
why  no  less  than  2 1 state  federations  and  29  international  or- 


13 


ganizations  have  gone  on  record  for  workmen’s  health  insurance 

laws.  / 

As  Dr.  John  A.  Lapp,  managing  editor  of  Modern  Medicine, 
and  director  of  investigations  of  the  Ohio  state  health  insurance 
commission,  said  in  a recent  address  before  the  American  Asso- 
ciation for  Labor  Legislation,  in  reviewing  the  findings  of  all 
these  official  commissions: 

“The  case  for  compulsory  health  insurance  is  fully  made  up  by 
the  eleven  reports  of  official  state  commissions.  It  seldom  hap- 
pens that  the  evidence  is  so  overwhelmingly  one  way.  The 
reports  indicate  clearly  the  nature  and  effect  of  the  sickness 
calamity.  They  prove  that  existing  provision  for  sickness  care 
and  prevention  for  wage-earners  are  utterly  inadequate.  Finally, 
they  show  that  cooperative  measurement  of  the  burden  and  col- 
lective action  through  social  insurance  is  the  logical  way  out.’* 

REMEDY  MADE  PLAIN  BY  INVESTIGATIONS 

The  conditions  calling  for  an  immediate,  adequate  remedy 
have  indeed  been  made  plain  to  us  by  these  studies.  They  have 
demonstrated  that  in  from  35  to  80  per  cent  of  the  calls  on 
organized  charity  the  principal  factor  is  sickness;  that  30  to  50 
per  cent  of  the  loans  to  workers  by  such  agencies  as  the  Morris 
Plan  hanks  are  forced  by  sickness;  that  about  one-fourth  of  all 
workers  are  so  sick  that  they  have  to  remain  away  from  work  for 
eight  days  or  more  every  year;  that  fully  one-third  of  those  too 
sick  to  work  are  without  medical  care;  that  families  with  the 
lowest  wages  have  the  most  sickness;  that  probably  50  per  cent 
of  this  sickness  is  due  to  health  hazards  in  industry  over  which 
the  workers  have  no  control;  that  one-third  of  those  in  the  poor- 
houses  have  been  driven  there  by  sickness. 

PREVENTIVE  AND  REMEDIAL  WORK  WILL  FOLLOW 

Here  is  a condition  calling  for  preventive  and  remedial  work 
which  will  be  effective  only  through  universal  health  insurance. 
The  proposed  health  insurance  bill,  as  now  developed  after  many 
consultations  with  representative  committees  of  all  groups  af- 
fected, provides  a cash  sickness  benefit  (to  keep  the  wolf  from 
the  door  and  spare  self-respecting  workers  from  resorting  to 
charity  when  illness  cuts  off  earnings)  ; adequate  medical  care 
(to  detect  and  remove  incipient  illness  before  it  becomes  chronic, 
to  restore  the  sick  worker  to  health  and  normal  productive  pow- 


V 


14 


ers  and  to  keep  him  so),  and  a funeral  benefit  as  under  the 
workmen’s  compensation  law.  It  also  provides  a maternity 
benefit  for  an  insured  woman  or  the  wife  of  an  insured  man, 
including  medical  care,  and,  in  addition,  a cash  benefit  paid  for 
not  more  than  eight  weeks  to  an  insured  woman  worker. 

BENEFITS  AND  COSTS  MUTUALLY  ARRANGED 

The  benefits  will  be  administered  by  local  mutual  organiza- 
tions or  “funds.’’  Employers  and  workers  have  equal  control 
over  the  “funds,’’  thereby  insuring  democratic  management  under 

the  general  supervision  of  the  State  Industrial  Commission.  / 

' \ 

The  cost,  amounting  on  the  average,  it  is  estimated,  to  about 

3 per  cent  of  wages,  is  to  be  . shared  equally  by  employers  and 
workers,  the  state  bearing  only  the  nominal  cost  of  central  super- 
vision, as  in  workmen’s  compensation. 

The  head  of  the  central  health  insurance  bureau  is  to  be  a 
physician,  county  medical  societies  are  given  the  power  of  initiat- 
ing the  fees  to  be  paid  by  the  insurance  funds  for  all  medical 
service  and  in  other  ways  the  economic  interests  of  the  medical 
profession  are  fully  safeguarded. 

Private  industrial  insurance  companies,  operating  for  profit, 
are  prohibited  from  doing  business  under  the  health  insurance 
act  so  the  benefits  may  be  provided  AT  ACTUAL  COST. 

SICKNESS  AND  ACCIDENTS  AS  CAUSES  OF  MISERY 

Sickness  in  industry  causes  fhore  than  six  times  as  much  suf- 
fering and  dependency  as  that  due  to  industrial  accidents.  Work- 
men’s accident  insurance  now  protects  the  workers  in  case  of 
injury;  workmen’s  health  insurance  is  needed  to  protect  them 
against  the  greater  hazard  of  sickness.  The  late  John  Mitchell, 
addressing  the  Conference  of  Catholic  Charities  shortly  before 
his  death,  declared: 

“Public  sentiment  in  this  country  is  developing  rapidly  in 
favor  of  universal  health  insurance  for  wage-earners,  including 
maternity  benefits;  and  my  own  observation,  through  long  experi- 
ence with  the  ravages  of  accident,  trade  disease  and  sickness 
among  working  people  and  their  families,  leads  me  to  the  con- 
viction that  health  insurance  is  even  more  important  than  work- 
men’s compensation.’’ 


15 


The  PREVENTIVE  side  of  workmen’s  health  insurance  is  of 
great  importance  in  any  discussion  of  sickness  and  poverty.  This 
is  tersely  set  forth  by  the  United  States  Public  Health  Service 
in  its  health  insurance  report  which  says: 

INSURANCE  EFFECTIVE  AS  A PREVENTIVE  AGENT 

“Experience  has  shown  that  insurance  is  an  efficient  method 
of  cooperation.  As  defined  by  practically  all  authorities,  insur- 
ance is  primarily  a method  by  which  a group  of  persons,  each 
singly  in  danger  of  some  loss  the  incidence  of  which  cannot  be 
exactly  foreseen,  can  distribute  such  loss,  when  it  occurs  to  any 
of  them,  over  the  whole  group  and  in  such  a way  that  the  burden 
of  expense  will  be  lightened  of  its  most  serious  effects.  Secon- 
darily, and  of  equal  importance,  insurance  means  that  the  strong- 
est of  incentives  — that  of  lessening  cost  — is  given  to  efforts  to 
diminish  the  frequency  and  the  seriousness  of  losses.  In  this 
latter  sense  insurance  is  a preventive  measure  of  a positive  and 
direct  sort.  It  cannot  be  denied  that  fire  insurance  has  been  one 
of  the  most  potent  factors  in  the  now  well-organized  movement 
for  the  prevention  of  fires.  Marine  insurance  has  resulted  in 
more  rigid  inspection  of  vessels,  the  'erection  of  lighthouses,  and 
in  many  other  measures  designed  to  lessen  the  chance  of  wreck. 
Liability  and  compensation  legislation  — which  is  but  another 
name  for  the  insurance  of  employees  against  accidents  — has 
resulted  in  the  nation-wide  movement  for  ‘safety  first.’  * * * 

Experience  has  shown  in  all  instances  that  while  the  distribution 
of  cost  is  primarily  the  method,  prevention  is  primarily  the 
purpose  of  insurance,  and  certainly  its  result.” 

So,  in  the  same  way  that  workmen’s  compensation  has  stimu- 
lated the  great  “safety  first’’  campaign,  workmen’s  health  insur- 
ance laws  mciy  be  counted  upon  to  result  in  a great  “health  first’’ 
movement — for  the  simple  and  compelling  reason  that  “it  pays.’’ 

HEALTH  INSURANCE  STRONGLY  URGED 

Finally,  is  it  not  significant  that  a majority  of  the  eleven  official 
state  commissions,  upon  the  results  of  their  recent  investigations 
into  sickness  conditions  among  workers,  have  strongly  urged  the 
adoption  of  workmen’s  health  insurance  laws?  And  is  it  not 
also  significant  that  the  greatest  industrial  nations  of*  the  world, 
with  the  single' exception  of  the  United  States,  facing  the  same 
serious  problems,  have  found  a successful  remedy  in  compulsory 
health  insurance? 


16 


Your  committee  presents  the  foregoing  study  as  a complete 
answer  to  the  opponents  of  health  insurance  who  have  hereto- 
fore minimized  the  effects  of  sickness  among  wage-earners  in  an 
effort  to  buttress  their  arguments  against  health  insurance. 

Fraternally, 

WILLIAM  P.  RANDER,  Vice  Chairman, 
JOHN  M.  O’HANLON,  Secretary, 

Committee  on  Health. 


DISCUSSION 


Following  the  address  by  Commissioner  Lynch  the  subject  was 
discussed  by  specialists  whp  are  in  daily  contact  with  the  sickness 
problem  among  wage-earners.  These  experts  regarded  the  sta- 
tistics presented  by  Mr.  Lynch  as  an  under  statement  and  not 
exaggeration  of  the  seriousness  of  the  problem  of  industrial  sick- 
ness, and  from  their  own  intensive  experience  they  testified  to 
the  need  and  value  of  workmen’s  health  insurance. 

The  following  brief  extracts  from  the  discussion  by  those  most 
intimately  in  touch  with  the  facts  indicate  the  soundness  of  labor’s 
position  in  urging  this  legislation: 

William  H.  Matthews,  Director  Family  Welfare  Department  of 
the  Association  for  Improving  the  Condition  of  the  Poor,  said: 

“I  don’t  think  there  is  anyone  who  has  worked  among  wage- 
earning groups  — particularly  the  lower  paid,  unorganized  wage- 
earning groiips  — who  would  not  agree  with  Commissioner  Lynch 
in  saying  that  at  least  50  per  cent  or  more  of  the  misery  and 
destitution  in  which  these  people  at  times  find  themselves  is  a 
direct  result  of  sickness.  It  doesn’t  seem  necessary  for  me  to  add 
any  figures  or  facts  to  those  Commissioner  Lynch  has  given.  Yet 
I do  want  to  cite  the  very  latest  figures  from  the  A.  I.  C.  P.  Those 
Commissioner  Lynch  has  given  you  may  seem  large;  they  are  not 
large  enough  in  comparison  with  our  figures  for  last  year.  The 
Family  Welfare  Department  of  the  A.  I.  C.  P.  last  year  had  under 
its  care  4,750  families,  and  in  4,323  of  those  families  we  found  it 
necessary  to  send  nurses  on  account  of  sickness.  * * * 

“There  came  to  my  office  one  day  last  week  John  Brady.  I 
will  give  you  the  facts  exact,  except  as  to  name.  He  brought  a 


17 


note  from  a nurse  of  the  hospital  admission  bureau,  and  it  read 
this  way:  ‘Examination  shows  the  bearer  to  be  suffering  from 
tuberculosis,  first  stage.  His  prognosis  is  good  provided  he  can 
rest  and  have  complete  treatment  for  at  least  six  months.’  Now 
John  Brady  had  always  pulled  his  own  boat.  He  wasn’t  known 
to  any  relief  organization.  He  had  taken  good  care  of  his  family 
and  had  worked  in  one  place  twelve  years.  His  wage  was  $25 
a week,  with  occasional  additions  for  overtime.  He  had  managed 
to  take  care  of  his  family  on  that.  Now  the  breakdown  had  come. 
* * * I found  he  had  had  influenza  back  in  January,  and  he 

had  stayed  home  just  four  days  and  gone  back  to  work  in  a 
weak  condition.  Why?  Because  his  pay  envelope  stopped  when 
he  stopped  work,  and  because  the  company  for  which  he  had 
worked  twelve  years  did  not  make  any  provision  for  John  Brady 
when  he  had  influenza;  so  he  went  back  to  work,  and  tubercu* 
losis  developed.  * * * 

“But  what  might  have  happened  to  John  Brady  if  he  had  had 
some  health  insurance  plan  such  as  Commissioner  Lynch  has  ad- 
vocated here  this  afternoon?  * * * As  I have  worked  with 

families  and  known  wage-earners’  families,  I know  that  they  live 
under  continual  stress  and  strain  and  anxiety  for  fear  of  the  to- 
morrow. Don’t  mistake  that.  Some  people  think  of  the  long- 
shoremen, the  truckmen,  the  general  unskilled  laborer,  as  men 
who  don’t  worry  much  about  the  morrow.  That  is  not  so.  They 
do  think  and  wonder  what  is  going  to  become  of  their  wives  and 
children  if  they  are  stricken  down;  and  living  under  that  constant 
strain  and  anxiety  means  of  itself  sickness  and  makes  more  easy 
the  approach  of  illness,  particularly  tuberculosis.  Now,  if  these 
men  could  go  on  and  work,  knowing  that  if  anything  happened, 
that  if  they  were  taken  sick,  they  would  be  cared  for  by  sickness 
insurance,  to  which  they  had  helped  contribute,  this  wearing 
anxiety  would  be  removed.  That  in  itself  would  spell  health  of 
body,  health  of  mind.  That  is  one  point  I would  stress.  * * * 

i 

“In  the  case  of  John  Brady,  if  this  insurance  plan  had  been  in 
effect,  he  would  not  have  had  to  hurry  back  after  the  attack  of 
influenza.  He  could  have  stayed  home  two  or  three  weeks  and 
gotten  back  his  strength.’’ 

Jessie  Rogers,  Supervisor  of  Nurses,  Henry  Street  Settlement, 
New  York  City,  said: 

“Commissioner  Lynch  spoke  of  sickness  as  the  greatest  single 


/ ' 


18 


cause  of  dependency,  and  the  nurse  and  social  worker  certainly 
find  that  is  true  in  a very  large  degree.  * * * 

“That  the  self-respect  of  the  workman  and  the  wage-earner 
need  to  be  preserved  is  so  often  evidenced  in  our  contact  with 
our  families.  I might  quote  many  stories  that  would  illustrate  it. 
I am  reminded  of  a family  where  the  group  consisted  of  the  father, 
the  mother  who  was  ill  with  pneumonia,  a child  of  two,  and  baby 
of  six  weeks.  The  father  was  of  necessity  home  from  work  be- 
cause he  was  caring  for  the  wife  and  the  baby.  I might  also  add 
that  he  was  not  only  doing  that  in  the  home,  but  taking  the  baby 
to  the  milk  station  for  advice  as  to  its  feeding.  The  nurse  attend- 
ing that  family  was  most  interested  in  the  care  the  father  gave. 
She  casually  asked  him  if  his  rent  had  been  raised.  He  said,  ‘Yes, 
only  two  dollars.’  But  that  seemed  large  when  there  was  a cor- 
responding decrease  in  wages,  but  he  was  most  cheerful  and 
wished  to  pay  for  the  nurse’s  service.  The  nurse  accepted  a small 
amount  to  preserve  his  self-respect.  The  woman’s  condition  on 
the  first  day  was  so  serious  that  the  nurse  called  at  the  doctor’s 
office.  Not  finding  him  there,  she  wrote  a note  requesting  an  early 
call.  She  also  sent  a night  nurse,  for  which  provision  the  man 
again  wished  to  pay  half  the  cost.  She  reluctantly  accepted  that. 
But  the  doctor  did  not  call.  The  next  day  the  nurse  called  him 
again  and  he  said  he  had  not  seen  the  patient.  He  did  not  call 
for  two  days,  and  not  until  the  father  had  been  to  the  doctor’s 
office  and  paid  for  a previous  visit!  The  nurse  realized  relief  was 
necessary.  She  suggested  a relief  organization  and  the  man  made 
application  and  received  $5.  We  learned  part  of  that  went  again 
to  the  doctor.  The  man  lost  his  job.  He  said  he  would  get  some- 
thing to  do;  his  wife  was  getting  better;  he  could  go  out  and  work 
on  the  street.  He  did.  The  nurse  finally  sent  the  mother  and  two 
children  to  the  country.  The  father  went  back  to  work  and  at 
last  reports  was  getting  $35  a week  and  a restored  and  happy 
family  is  the  result.  This  is  not  the  result  in  all  cases.  Every 
wage-earner  at  home  on  account  of  illness  cannot  lift  himself  out 
of  a situation  as  this  man  did. 

“I  want  to  state  that  it  seems  to  us  as  we  meet  these  situations 
that  the  problem,  of  provision  for  sickness  is  a dual  one,  and  it 
becomes  an  economic  one  from  the  standpoint  of  the  family  and 
from  the  standpoint  of  the  employer.  The  suggestion  of  the  need 
of  a doctor  to  the  anxious  mother  who  has  a sick  child  very  often 
brings  to  us  the  reply,  ‘Yes,  but  the  calling  of  the  doctor  and  the 


19 


medicine  that  will  be  necessary  will  mean  $5.’  The  sick  benefit 
at  the  time  when  the  wage-earner  must  be  at  home  because  of 
his  own  sickness  will  provide  care  and  support  to  a large  degree. 
The  problem  is  certainly  a social  one,  and  that  leads  me  to  say 
that  health  insurance  would  extend  the  social  function  of  the 
physician  and  the  nurse.  As  the  physician  goes  into  our  average 
home,  he  goes  sometimes  even  in  acute  illness  only  once  or  twice 
or  three  times.  A great  many  of  the  city  laboring  classes  do  not 
have  regular  physicians;  the  physician  is  interested  in  his  case,  but 
sees  it  only  during  the  acute  stage  of  illness.  If  the  nurse  appeals 
to  the  doctor  he  says,  ‘I  have  seen  that  case  only  once  or  twice,’ 
and  the  cost  of  the  visit  is  a necessary  consideration.  The  pro- 
vision of  adequate  medical  service  through  health  insurance  would 
take  care  of  that. 

“Dr.  Goldwater  emphasized  the  social  function  of  the  doctor 
and  social  service.  He  said  that  the  hospital,  big  as  its  social 
intent  was,  could  not  meet  the  needs  of  the  community.  * * * 

He  hoped  that  provision  might  be  made  for  this  socialized  prac- 
tice by  a return  to  the  family  practitioner,  and  that  health  insur- 
ance might  mean  such  a provision.  * * * 

“I  must  say  a word  about  the  provision  in  health  insurance  for 
maternity.  The  great  advantage  of  provision  as  proposed  in  this 
country  is  that  not  only  do  we  intend  to  provide  adequate  ma- 
ternity care  to  the  insured  woman,  but  we  mean  there  shall  be  a 
maternity  benefit  which  will  carry  that  mother  through  two 
weeks  before  the  coming  of  the  child  and  the  necessary  six  weeks 
following.  * * * 

“A  recent  publication  from  Albany,  The  Monthly  Bulletin,  on 
‘Industrial  Health  Conservation  an  Economic  Necessity,’  states: 
‘Successful  health  conservation  can  only  be  achieved  by  a form 
of  health  government;  neither  paternalistic  nor  socialistic,  but 
administered  through  the  intelligent  cooperation  of  executive  and 
worker  and  for  the  best  interests  of  both  .” 


UwiVtKSiYV  Of  lUitttiso  l.***«» 

MAR  25  1921 


HHnnHBHMBHnnBBMHBHEHBHBmaBBHBHKEHBnB 

WORKMENS  HEALTH  INSURANCE  IN  GREAT 
BRITAIN  A RECOGNIZED  SUCCESS 


PROMINENT  TRADE  UNION  OFFICIAL  REPORTS  THAT 
WAGE-EARNERS,  AFTER  SEVEN  YEARS’  EXPERIENCE, 
STRONGLY  FAVOR  COMPULSORY  PLAN  OF 
SICKNESS  PROTECTION 


CJ  “In  reference  to  our  experience  with  Compulsory  Health  In- 
surance legislation  in  Great  Britain  I can  say  that  the  law  is  in 
better  favor  now  than  it  was  at  the  beginning.  The  early  friction 
was  mainly  due  to  the  fact  that  the  Act  was  passed  through  Parlia- 
ment very  quickly  and'  made  operative  before  its  administrative 
processes  had  been  thoroughly  thought  out. 

q “The  wage-earners  have  participated  in  the  management  of 
the  Health  Insurance  funds  and  there  has  been  little  or  no  inter- 
ference with  the  freedom  of  the  individual.  It  is  very  rarely  that 
we  hear  any  serious  complaint,  and  I cannot  see  that  the  success 
of  the  organized  labor  movement  has  been  in  any  way  jeopardized 
by  this  legislation. 

q "Our  Workmen’s  Compensation  Law  of  1906  provides  pay- 
ment for  occupational  diseases,  and  as  far  as  it  can  go  it  is  good, 
but  the  benefits  to  the  worker  are  bound  to  be  insignificant  when 
compared  with  the  much  greater  benefits  of  the  Health  Insurance 
Act. 

C]|  “Industry  should,  of  course,  bear  the  whole  cost  of  strictly 
occupational  sickness,  but  efforts  to  separate  the  illness  in  capacity 
which  is  due  solely  to  conditions  of  employment  from  the  inca- 
pacity resulting  from  sickness  in  general  and  to  put  the  whole 
cost  of  the  former  on  industry,  have  not  met  with  much  success. 
Occupational  disease  compensation,  we  find,  needs  to  be  supple- 
mented by  Health  Insurance. 

CJ  “ It  is  recognized  that  permanent  and  general  sickness  benefits 
to  all  of  the  workers  can  be  furnished  most  economically  through 
a compulsory  plan  of  insurance,  and,  although  I have  not  great  love 
for  State  interference  in  the  ordinary  affairs  of  life,  I am  bound 
to  say  that  the  experience  gained  after  seven  years’  administration 
suggests  that  it  would  be  desirable  for  every  country  to  have  a 
Workmen’s  Health  Insurance  system  on  a universal  basis.’’ 

W.  A.  APPLETON, 

Secretary  of  the  General  Federation  of  Trades 
Unions  of  Great  Britain  and  President  of  the 
International  Federation  of  Trades  Unions. 


